The leveraged ETFs suffered historical losses late last week, and as global trade tensions rose to new peaks, retail investors left a ruthless situation. In two trade sessions, over 25.7 billion dollars of leveled ETFs were deleted, which said the worst output for these high -risk instruments, according to the Financial Times.
This significant decline stems from the increasing trade barriers under the Trump administration by implementing comprehensive “mutual” tariffs that initiate sales in both traditional and digital markets. These include a 104% tariff for products from China, a long -term economic decline and a tariff that increases opportunities for the instability of global stock market.
The leveraged ETFs, which can often mimic index performance up to five times the daily returns, suffered the most. These products have become popular among retail traders looking for high returns in their investments, but showed significant weakness during macroeconomic uprisings.
As Elisabeth Kashner Was noted, These are “very sharp knives” and they should be very careful when using them. “They will be used for very special purposes and people who use them have to know what they are doing,” he said.
Single Stock Frames Hard Hard
Some of the most severe decreases in single stock futures took place during a two -day accident. The leverage shares in the Irish list suffered the biggest loss of 4x -long semiconductors ETP and a decrease of more than 59%. Other leveraged funds, such as Boeing, Arm Holdings and 7 magnificent technology stock funds, fell more than 50%.
The Nasdaq-Tracking Proshares Ultrapro QQQ was the largest loser with $ 20 billion assets in management. In the same period, he won $ 6.3 billion, which shows that the technology industry is quite vulnerable to macroeconomic and geopolitical factors.
The collapse of the ETF market, the Pandemik Panic in March 2020 and the “Volmageddon” volatility of 2018, overshaded previous Sellloffs. Analysts also pointed out that some USA can not be lifted more than 3 times the positions of leverage ETFs. At the same time, colleagues in other markets can be more leverage, which can cause much higher losses.
Bitcoin can benefit from global economic stress
While the leveraged ETFs are fighting, analysts expect a improvement for Bitcoin (BTC) as other factors come into play. Although short -term decreases led to the BTC to test the $ 76,000 brand, experts drew attention to macroeconomic factors that could maintain Bitcoin’s status as a safe asset.
Binance CEO Richard Teng allegedly This Bitcoin may rise because it is a paradise for investors looking for other safe assets. He drew attention to the flexibility of BTC’s long -term owners and said that short -term fluctuations can help further adopt BTC and other coins.
“This The environment can also accelerate the interest in crypto as a non -dominant store. Value, ”Teng said.
Bitwise’s investment chairman Matt Hougan signed an agreement with this view. Authorized, a dollar in trade in trade may cause an increase in Bitcoin prices in the short term, he said.
In the future, Hougan saw a possibility of a more diversified system reserve. “Hard money like Bitcoin and Gold [may] Play a bigger role than today, “ HE said Investors.
Matthew Sigel, President of Vanck’s Digital Asset Research Studies, also entered and said that the action to take the Fed’s economic drag from tariffs could lead to an increase in crypto currencies. If inflation is checked, interruptions can restore the familiar high liquidity conditions that are traditionally favorable for Bitcoin’s growth.
However, even in the face of chaos, Trump did not seem to change his approach. Although he described the tariffs as “permanent ,, he also said that they pressure on his colleagues to enter negotiations. The unpredictability has already caused more confusion in variable markets.
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